According to the Realtor Affordability Distribution Curve and Score, affordability declined nationally from Q3 2017 to Q3 2018. However, it is interesting to note that 20 of the 100 largest metros in the country experienced improved affordability. The report attributed the increase in inventory in 2018 fall as the reason for affordability in these metros.
The report found that 66 out of the 100 largest metros surveyed recorded a decline in affordability over the past year. Fourteen of these cities remain unchanged.
The share of active listing inventory decreased from 19.7 percent to 15.4 percent among households earning $35,000 and dropped from 53.9 percent to 47.3 percent among households earning $75,000. This is a clear indication that some above-median income households cannot afford the median home listing, the report stated. Nationally, the country’s distribution score (a summary of affordability across income levels) decreased from 0.84 last fall to 0.80.
The larger and more expensive markets across the country recorded high inventory growth rates. Inventory in Austin, Oxnard-Thousand Oaks, Nashville, San Jose, and Portland far outpaced the national rate of 2 percent. San Jose and Nashville topped the charts with growth rates at 129.9 percent and 32 percent, respectively.
In October, inventory in Austin, Oxnard-Thousand Oaks, Nashville, San Jose, and Portland grew faster than the national rate of 2 percent, with San Jose and Nashville leading the list with growth rates of 129.9 percent and 32.0 percent growth, respectively. New listings on the market are 10 percent smaller and on average 8 percent cheaper than existing inventory.
Most affordable markets
Austin-Round Rock, Texas leads the charge at 0.67, followed by Oxnard-Thousand Oaks-Ventura, California at 0.44, Nashville-Davidson, Tennessee at 0.70, San Jose-Sunnyvale, California at 0.46 and Portland-Vancouver, Oregon-Washington at 0.55.
Least affordable markets
Spokane-Spokane Valley, Washington recorded a drop at 0.65, followed by Boise City, Idaho at 0.63, Las Vegas-Henderson-Paradise, North Virginia at 0.65, Wichita, Kansas at 0.98 and Columbia, South Carolina at 0.94.